KUALA LUMPUR: Heineken Malaysia Bhd sees 2021 to continue face challenges from Covid-19 pandemic, lockdowns with restrictions on social activities which will impact the business moving forward.
Managing director Roland Bala said further, the suspension of operation at its Sungai Way brewery plant as well as bars and pubs that does not have restaurant licence has also impacted consumption sales in 2020 and will likely continue in 2021.
"2020 was indeed a very challenging year. The pandemic has disrupted businesses and affected people's lives, requiring us to adapt to the new market realities.
"For the first time in our history, we had to suspend production and business operations for an extended period following the government's Movement Control Order (MCO).
"Adverse conditions in the external environment have impacted the on-trade channel in particular, whilst restrictions on social activities have affected consumption in general," he said during the full year 2020 financial year results virtual briefing today.
Heineken Malaysia group revenue for the 12 months ended 31 December 2020 (FY20) declined by 24 per cent to RM1.76 billion as compared to RM2.32 billion in FY19, while net profit decreased by 50.7 per cent to RM154 million from RM313 million in FY19.
Despite the gradual recovery of economic activities after the second quarter, the group's business performance particularly in the on-trade channel continued to be affected.
Profit before tax (PBT) dropped 52 per cent due to the pandemic and the one-off settlement of the Customs' Bills of Demand amounting to RM7.2 million in June 2020. This was partially mitigated by the cost savings measures.
For the fourth quarter (Q4), group revenue also decreased by 24 per cent to RM519 million from RM680 million in the same quarter in 2019, mainly due to lower sales impacted by the government's implementation of wider restrictions and stricter standard operating procedures relating to social activities in its effort to combat the rising wave of Covid-19 cases.
Group PBT decreased by 44 per cent, largely due to lower revenue and a one-off provision of RM14 million in December 2020 for costs associated with the organisational restructuring exercise being implemented in 2021.
Heineken Malaysia has proposed a first and final single tier dividend of 51 sen per share for FY20, subject to approval of shareholders at the forthcoming annual general meeting.
The single tier dividend will be paid on 28 July 2021.
Moving into 2021, Roland said Heineken Malaysia will continue to invest and enhance its digital strategies through its e-commerce platform, Drinkies via business-to-business (B2B) and business-to-consumer (B2C) segments.
"The group will also front load our agenda to implement continuous productivity improvements, and adapt to new market to drive efficiency in 2021," he said.
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